00:01>> Andrea will be interviewed this evening by Ronak Desai
00:03who -- many of you know -- is a second year student, and
00:06member of the "View From The Top" committee.
00:08Before coming to the GSB, Ronak worked for J. P. Morgan and
00:11GE on the East Coast, and then worked in India for Genpact,
00:16a subsidiary of GE, where he was vice president for
00:18corporate development.
00:19Let's welcome Ronak to the GSB stage as well.
00:22Andrea Jung: Well, first of all, good evening everybody.
00:32It's a privilege to be here, and thank you all for coming
00:36I grew up in a family where all we knew about business
00:42school was Stanford.
00:43My little brother here -- one of my favorite people in the
00:47world -- has always been the biggest fan and spokesperson
00:53So it was a no brainer on one hand to come and speak to the
00:58school, but more importantly, just to have the opportunity
01:01to kind of share some of my thoughts.
01:03And I also -- I did not realize I was going to be seeing one
01:06of my other favorite people in life, Henry Groswhite, behind
01:09my brother, who was -- he actually recruited me from
01:12Princeton for my very first job -- was my very first boss.
01:15So I think, through the evening, you could ask him some Q
01:18and A about what I was like.
01:19>> I don't know if you want to hear that answer.
01:22But, I owe a tremendous amount -- the whole reason I think
01:25I started from the very early days.
01:27But, before we get into some Q and A, I just thought I would
01:31give you just a quick snapshot of who I am.
01:34And I think, as you heard before -- thank you for that
01:36wonderful introduction.
01:38And I won't go that much into Avon.
01:40It is an interesting company.
01:42140 something countries.
01:45Well over ten billion dollars today with six million Avon
01:48So I think we have more Avon representatives than the army,
01:53the air force, and the navy combined in Brazil.
01:56>> And over a million-one in China.
01:58So, the numbers are huge.
02:00But, let me just tell you one thing about myself, which I
02:03think will start this.
02:04And that is that, I think I'm in this job ten years as of
02:11Ten years as the CEO, which my father -- he sent me an
02:14article -- he usually doesn't do this -- that had on the
02:17cover of Business Week that the average tenure was at that
02:21And he sent it to me with this bit question mark like, "Are
02:24you coming home after this??
02:25>> "What are you doing after this??
02:27And I would say to you, first and foremost, that you know, I
02:32have a love affair with my work and my company.
02:36I have not loved this job every single day, which we can
02:40The CEO's job, after 40 public quarters, and particularly in
02:44the last couple of years, is not exactly what I would say is
02:47"fun", but I have had a huge passion for it.
02:51And I guess I would just express this by telling you that,
02:54in 1997, I was on a short list of -- I guess -- potential
02:58CEOs for the company.
02:59And there was a lot of visibility on it, for those of you
03:02who are women in the audience, because I think at that time
03:05there was only one woman -- maybe two -- Carly Fiorina and
03:08Marianne Sandler were the only two public company CEOs at
03:12And so, I was in line to become the CEO of the company.
03:17Company hit a sort of tough spot, and the board decided,
03:22even though they had kind of given me the nod that I would
03:25get the job, that they were going to go with one of our
03:28directors, a gentleman who had been a CEO and was 52 years
03:34So they told me that I was not going to get the job, and
03:38that I could be the number two.
03:41And the papers, the New York Times kind of really were all
03:47over that, because there was this whole overwhelming "Woman
03:51Passed Over: There is a Glass Ceiling" reaction to it, at
03:55which point, I got actually two other pretty big CEO job
04:01So, I was at this inflection point, because there I was, the
04:06boss that I was going to work for was 52, so it wasn't like
04:10he was 62 or they could tell me, "Just do this for a couple
04:13of years and you can get the job.?
04:15They were basically saying, "He's here.
04:18You're here to support him.?
04:21And I was being offered the money, the title, the corner
04:24office that came with some pretty interesting benefits.
04:29And a mentor of mine said, "Follow your compass, not your
04:36And I say that again.
04:38She said, "Follow your compass, not your clock.?
04:41Make this decision not from your head, but from your heart.
04:45And that was the biggest inflection point of my career.
04:49I made the decision that I loved the company.
04:53I loved its mission, its purpose.
04:55We were in a tough time.
04:58And I decided that I loved that more than I loved the idea
05:03of being a CEO or anything else that came with that.
05:06That I would rather be with the company and work I loved
05:10than just do it for the sake of the title and, quote, "the
05:13path that you were supposed to be achieving.?
05:15And in that decision, I think that changed my life.
05:19It changed my life careerwise.
05:21I will tell you it didn't work out for him, so I got the job
05:26in 21 months, and the rest is history.
05:27>> But I just am starting -- I'm starting to tell you,
05:31because I don't know who else would be here on View From The
05:34Top, because I would make that decision again even if I were
05:39still number two today.
05:40Even if he were still the CEO, and I were the number two
05:47person, I'm so passionate about the work that I do and the
05:53contribution that I think that the work is making, and I
05:56have a piece in that, that I would make that decision all
05:59over again even if it hadn't turned out this way and
06:02somebody else would be sitting here on View From The Top.
06:05That's the most important thing that -- before we even get
06:07into this -- that I want to share with you, that if you don'
06:10t love the work -- and you all are about to go out and do
06:14some pretty extraordinary things.
06:15I have had plenty of business school friends -- as you can
06:18imagine -- after I graduated from Princeton, whether it was
06:20from here or places on the East Coast.
06:24And if the work and the company was a job, or even a career,
06:33but not a passion, you're still not doing it.
06:40They're not doing that anymore.
06:42Other things, children -- I have them.
06:44Other things take precedence when it's not deep passion for
06:49So I just, that's the first thing I wanted to tell you is
06:52that luckily, life turned out for me, and I get to be here
06:56But it wouldn't have mattered if it didn't, because I've
06:59actually found a company that I loved.
07:02And that's my most important thing I wanted to share with
07:05you before we even started.
07:08>> Once again, thank you so much for joining us.
07:11It's a privilege to have you here.
07:12Just picking up on that theme of passion a little bit.
07:16I've read that your parents believed in well-rounded
07:20They provided access to piano lessons, Mandarin lessons, you
07:23went to Princeton for your undergrad education.
07:26And when you first started your career by taking up retail
07:29jobs -- from what I've read at least -- there were a little
07:32bit of gasps and said, "Hey, you know, this doesn't sound
07:35like a great career move.?
07:36Sort of reminds me of my parents reaction when I told them I
07:39wasn't going to be a doctor.
07:41>> So starting back then, how did you imagine to stay true
07:43to your passions and your dreams?
07:45Andrea Jung: Well, it was interesting, because I mean, mom
07:47and dad came from China, came here to give us educations and
07:52hopefully, you know, Ivy League educations, and then going
07:56into -- not different than your parents -- doctor, lawyer --
07:58just something they thought more intellectual than retail.
08:02So I decided when after Henry here recruited me to go and
08:06work in the retail business, I think their first reaction
08:09was, "That really wasn't what we had in mind.?
08:12Andrea Jung: But, then the family values set in, which were
08:18"No matter what it is you do, then you better go and be your
08:20You better go and you better work hard.?
08:22And I remember -- oh gosh, it was just by Thanksgiving of
08:29that first year in that training program.
08:31And I was changing hangers in a stockroom.
08:36And all I was doing was taking the vendor hangers -- why are
08:46Andrea Jung: It was worse than -- I'm being very nice about
08:49Andrea Jung: I was taking the vendor hangers and putting the
08:53store hangers on this thinking to myself, "I got a Princeton
08:57education to do this??
09:00Andrea Jung: And I remember one day saying to my mom, "Um.
09:05I mean, it could be really interesting, but I really feel
09:09like I'm doing some menial work here, and I don't know.
09:13Maybe, maybe I should quit.?
09:14And she said to me -- it took less than a heartbeat.
09:17She said to me, "Quit?
09:18We don't quit in this family.
09:22You start at the bottom, and you work your way up.
09:25What is it that you are learning from that?
09:26You are not quitting.
09:28I don't care who else is in that training program that's
09:30putting -- we don't quit on anything in this family.?
09:33And that perseverance, even though when they quickly got
09:36over it, now they think it was great.
09:38They tell the story.
09:39They have all the scrapbooks about it.
09:41But it wasn't like that in the beginning.
09:43Andrea Jung: But that thought really was resident in I
09:45think, you know, our family's culture.
09:47So it was, "Just whatever you decide to do, stick with it.?
09:50It's not going to be easy.
09:53No path to success comes without stones in it.
09:55So you're going to have to take some tough days.
09:58You're not going to like it a lot of the time, but that's
10:04>> It sounds like your parents did a great job of sort of
10:07combining, you know -- you often get immigrant values when
10:09you immigrate to the U.S -- with sort of the American
10:12culture blending into that.
10:13Can you talk a little bit more about that? About how -- what
10:16kind of values you grew up with, and how do those translate
10:19into the values you want to leave for your children?
10:24You know, I feel really proud that I haven't had to change
10:28who I am to be successful in this world.
10:31Dan Rather was doing the series of interviews -- when I
10:35first became the CEO -- of a couple of women executives.
10:38And he actually went and interviewed families, parents.
10:42And so, he went up and interviewed my parents.
10:44My mom cleaned the house.
10:46They were trying to serve him Chinese food.
10:48Andrea Jung: They do this huge thing for like hours and
10:52And you know how -- well, those of you who know media --
10:54they trunk it down to a 20-second sound bite after
10:58interviewing for hours and hours and hours.
11:01All of this they take it down to one sound bite on
11:06television where he's asking my father, "So, did you always
11:10know that your daughter was going to be a successful CEO??
11:14And he says, on public television, "As a matter of fact,
11:19We raised our kids as pretty traditional Chinese, family
11:23values, and my perception of CEOs -- really hard core, cut
11:29I -- I really can't imagine that she's going to be that
11:32Andrea Jung: I'm thinking, "This is public TV!" So, but the
11:41truth is, in that thought was the fear, I think, that my
11:47family values system had that the concept of being kind,
11:52about caring about people, about being respectful -- would
11:55go get washed out of the window of a very, very -- in his
12:01mind -- typical behaviors required in the corner office.
12:07And, have I had to change some things?
12:11I mean, I think I am much more assertive.
12:14I mean, you know, kind of growing up in an Asian background
12:18sort of avoid conflict around the dinner table is the
12:22thought, Don't argue about things.
12:24I have had to become more assertive and have to understand
12:27the roll of constructive conflict.
12:30I don't think I'm aggressive.
12:31I don't think I've had to change my personality or who I am
12:36And you know, so I think the best thing my parents would say
12:40about me -- I hope -- they say it now, and it makes me
12:43happy, is to say, "Well, she's really still the same person.
12:45Even though, you know, she's on some list some place.?
12:48And that's what I hope my children realize is that those
12:53values are more important than anything else.
12:56>> How does that translate?
12:58I mean you got five-and-a-half million sales representatives
13:02How does that play into how you motivate them, how you get
13:04them inspired, and how you lead the organization?
13:07Andrea Jung: Well, it's interesting, because they are
13:11independent representatives.
13:13So I underline that word.
13:14I mean -- different than, I guess, other CEOs -- they're not
13:18They don't have to work for me every day.
13:23So I can't tell them what to do.
13:25You know, you learn, and the skill is an interesting one.
13:28And it applies anywhere whether, I guess, it's politics or
13:31I mean, influence is a very different thing.
13:33Motivation, inspiration, and influence are very different
13:36things than leadership requirements and mandates.
13:40And so, you know, this skill of communicating is the skill
13:45of influencing and inspiring.
13:47And mission and values and purpose have been the way that
13:52we've effectively kept that sales force going.
13:56This year -- you and I had a little conversation on the way
13:59over, but -- you know, no different than any other company,
14:03You go into the buzzsaw of the global economic crisis a year
14:07ago, and everybody's like, "Okay. We're going to cut.
14:10We've got to freeze salaries.
14:12We're not going to hire.
14:14You know, whatever all of the things that just come flying
14:20And we just -- besides that we needed to keep our people
14:23But more importantly, go back to the original purpose of the
14:28company in order to find the answer for the way we were
14:33going to get through this year.
14:34And that was that, you know, the company was is 123 years
14:38old, and the founder actually was a man who believed that
14:43women should be economically empowered.
14:46I mean, I actually love the story.
14:48He was an encyclopedia salesman, and all of the direct
14:52sellers were men at the time.
14:54And somebody gave him a vile of perfume one Christmas, and
15:00he realized everybody who was home were the women, and they
15:04were basically saying to him, "We don't want the books.
15:06Can you just buy the perfume that you were supposed to give
15:10So he realized there was something there.
15:13Andrea Jung: But the most important thing he did, because it
15:16was 1886, was decide that the seller wouldn't be men.
15:20That he was going to actually employ a woman, which was
15:24heretical at the time, because women weren't even allowed to
15:27vote, never mind make money outside of the home.
15:29And so, it was not popular in the beginning, but he actually
15:34went out and created the first woman salesforce, and became
15:40the economic solution for women here in the United States.
15:44And that has transferred to 140 countries now.
15:47And you can imagine its power in India and all of the
15:51But we decided in 2009, unemployment predicted, and now we
15:55see over ten percent here and rampant everywhere else but,
15:59you know, we're going to be a solution -- that the company's
16:01not just going to be about earnings per share and everything
16:04That we're actually going to have the business purpose to be
16:09a solution to governments and unemployment right now.
16:11And we were going to go out and be very aggressive about
16:15telling women that they could earn if they got laid off, or
16:19their husbands got laid off, or they wanted extra income.
16:22And it's been extremely motivating, and it's almost no
16:25language necessary when you have mission and purpose.
16:28We did a very bold thing.
16:30You know, a lot of people were cutting back on advertising.
16:32We decided, We're going to advertise.
16:34I remember the day I said, "We're going to advertise on the
16:37Superbowl this year.?
16:38And people were like, "The Superbowl?
16:40B, you know, it's Buddweiser..?
16:43Andrea Jung: Those were the kind of products.
16:45So Andrea, we're going to advertise skincare or lipstick?
16:50And I said, "Neither.?
16:51We're going to create an ad, a testimonial ad of people who
16:55joined us since they got laid off, and they're going to tell
16:58Everybody just looked at us, and we said -- we went out and
17:02we created a very compelling ad where the message was
17:06authentic and genuine and people really said, "I can't get
17:09I'm running my own business.
17:12They're my own hours.
17:13It's my own business.
17:17And the phone was off the hook before halftime -- as you can
17:22imagine -- for all the women watching at the same time from
17:27And this began what has become probably more people who've
17:31joined than certainly in the United States since the 70's.
17:34It's been an amazing thing, but it was this proactive
17:38message that entrepreneurship is "in," and it's important,
17:44and it's part of the economy solution.
17:47>> Based on everything you said as we walked over and now.
17:49It seems like you've got, you know, your finger on the pulse
17:52of your organization.
17:53Oftentimes, CEOs say "It's lonely at the top.?
17:56And I was wondering how you sort of combat that, and how you
17:59get beyond sort of the walls of the executive suite?
18:02I think it's important.
18:03It's actually interesting and difficult -- not difficult --
18:05but, you know, it's a vertical company, which I love.
18:09I mean, so we do everything from product development all the
18:12way out to the end consumer.
18:13So we are completely vertical, which is wonderful, but it's
18:18You know, and you can get isolated, because you're not
18:22trying to get the end cap at Wal-Mart or you know, trying to
18:26get the order vs. Loreal or anybody else in the department
18:29So we own the chain but worry that our people just get too
18:38So for me, it's a couple things, I guess.
18:41One is very selectively making sure that I had an outside-in
18:49So I'm on two boards.
18:50As you heard, I'm on General Electric's board, and Apple --
18:52completely different.
18:54I can talk about that in a minute.
18:55But, they've really helped me stay current, and forced me to
18:59kind of reassess my own skills.
19:01I'm out in the field a lot.
19:04I mean, I was an Avon representative when I joined and every
19:08other year, I sign up and become an Avon representative --
19:11hope nobody recognizes me, and go out and try and sell,
19:14which is extraordinarily -- it's very, very humbling.
19:19And I try and really get people to tell me the good, bad,
19:25and the ugly -- particularly the latter.
19:29I don't know that the word is "lonely.?
19:31But, you know, people aren't going to come and say, "You
19:34In this meeting, this is what you did wrong.
19:36You shut people down.
19:38I mean that kind of feedback sounds good on paper, but it
19:42just doesn't happen.
19:44So trying to have the ability to have your top team feel the
19:51informal and formal way to give you feedback, to tell you
19:56what you're not doing wrong, so that you can reinvent
19:59It's pretty important.
20:02>> Picking up on your two boards.
20:04I'm sure we'd all love to know kind of how you view your
20:07leadership style as being different from Steve Jobs' or Jeff
20:10In particular, what you think Jeff and Jack before --
20:13Andrea Jung: I was going to wear my jeans and my black coat.
20:16Andrea Jung: But Mark told me I needed to wear a suit.
20:23Fascinating experiences.
20:24So I was, you know, I mean, in this day and age tough to
20:30find the time, because I think boards take time.
20:32I mean, I think this is a world and -- speaking for a second
20:36just being a director, the responsibility of being a public
20:38company director obviously is huge these days.
20:41And the commitment really is time-consuming, but I was on
20:48GE's board since actually before I became a CEO at Avon, so
20:53I've been on that board eleven years now.
20:55And was pretty much exclusively on one board until I joined
21:05So, it was ten years before I joined a second board.
21:08And I did that -- I mean -- GE has been extraordinary.
21:14I didn't go to business school -- my secret.
21:15I wish I had come here.
21:18I didn't go to business school and, in a way, it has been my
21:23business school from everything of process point of view on
21:28one hand you would say "aircraft engines", "power systems,"
21:32"medical systems," "lipstick and skin care" -- completely
21:36different businesses.
21:37On the other hand, the processes, globalization, quality
21:44programs, how they do things across the world -- as you know
21:48-- are hugely beneficial to any business leader.
21:54So that has been enormous.
21:56The talent process at GE is second to none.
22:02I mean, from the training to the succession planning and the
22:05depth, I have brought so much back.
22:09I am that much better a leader.
22:10And we were -- when I started the company, we were what --
22:15$3 billion, and I think four and change when I became the
22:18CEO, and it'll be $11 billion.
22:19So, you know, to run a ten billion dollar plus company
22:25I mean, you would think -- it's completely different, and
22:27the process that's necessary.
22:29Because we were a very entrepreneurial company, but you need
22:32the systems and the processes.
22:33And you want to keep the combination of instinct and facts,
22:36but we needed them, and I learned a tremendous amount of
22:39We would not be the company that I think that we are today
22:41if I hadn't learned what I did from being at GE.
22:45The succession planning process at GE, you know, the
22:48decision how Jack made the decision, you know, just how he
22:53thought about that was beyond fascinating.
22:56I was on that committee.
22:57That was enormously fascinating.
23:01So then, fast forward to, you know, I had known Steve --
23:05always a huge admirer of the company.
23:08And one day, I got a phone call and he just said he was in
23:11New York and he came up showed me the new Nano and we had a
23:15great conversation and asked me to be on the board and the
23:18rest has been history.
23:19It's been -- it's so different on the other hand.
23:23I mean, but I don't leave that meeting -- and I have it
23:27tomorrow -- without thinking, "God, I need to be a better
23:30CEO when I walk out.?
23:33I like to think that I am, you know, in touch with the
23:38consumer, have passion for product, the user experience, but
23:45I mean, the whole company, not just Steve.
23:48But, the company is -- I'm sure you all know -- just
23:52maniacal and fanatical about excellence whether we're going
23:56to go into the retail business, whether we're going to go
23:59into the gaming business, whether we're going to go into the
24:03It's just a laser focus.
24:08I think what they say "no" to is as important as what they
24:13And that discipline is something that I have definitely
24:17learned from when I come back and try and run the company.
24:20But, just as a consumer marketer, I always leave there
24:23going, "Oh gosh, I've got to be better when I go back
24:26Better look at that bottle one more time.
24:28The curvature is not too perfect.?
24:30>> Given that you're here for the board meeting, I'm sure
24:36we'd love to know when the Apple Tablet's coming out?
24:37Andrea Jung: I'm sure you would.
24:44>> One more question before we open it up to the audience.
24:47Based on, you know, a lot of what you've spoken about has
24:51been reinventing yourself as either the environment's
24:52changed, or Avon business has change.
24:54I was just wondering about how you reinvent yourself as a
24:59CEO and how you take a step back, re-examine, and do
25:02something different?
25:03Well, I think you know, the company we like to say is "123
25:09And the only way to do that, I mean, you can't reinvent a
25:11company without reinventing yourself first.
25:13So, reinvention of a brand or reinvention of a company is
25:18only as good as the reinvention of the leader and the
25:21And it is interesting being in the job ten years and yet,
25:27it's a huge privilege on one hand.
25:29I actually don't know how people are kind of coming into
25:32this job in this environment and having to kind of put all
25:35truths other here and start afresh.
25:37Having had a decade to go through cycles and reinvent myself
25:40and learn from my own mistakes, I think, has clearly been an
25:44enabler to getting through this environment.
25:46But, I'll tell you one story.
25:48So the first five years, I was a growth CEO.
25:52I mean, we were booming into emerging markets, we had
25:56double-digit, top-line growth, 25-percent earnings growth
25:59for five years running.
26:00I mean, I never did a layoff.
26:03I had no idea what the word "turn-around" meant, and we hit
26:06the wall, you know, as all businesses do.
26:08And if you're in any job long enough, I can promise you,
26:12Businesses are cyclical, whether it's pharma, you name it.
26:16There's always cycles.
26:17I'd gone probably longer than not without hitting the wall,
26:21but we hit the wall in 2005.
26:23And we, at that time, gave earnings guidance.
26:26And we missed guidance twice in -- I don't know -- four
26:29And I don't know if some of you know Rahm Sheran, who's sort
26:32of a coach to CEOs and has been a friend of mine for a long
26:36time, but, he came up into my office on a Friday night, and
26:40he said to me, "You want some tough love??
26:42And he said to me, "The board loves you.
26:46People in this company love you.
26:49But, in about 120 days, they're going to have to fire you.?
26:53I just looked at him, and he said, "You do understand that,
26:56I mean, unfortunately, when you're in this job, you got
27:01I mean, if you can't turn this around -- if you can't look
27:05at this thing with new eyes, it's going to kill them.
27:10They're not going to have a choice.?
27:11I said, "Well, that was pretty tough love.?
27:18Earlier that week, one of the people that worked for me
27:21said, "You know what?
27:23I've got these people that want to come in, because when I
27:25was at AT&T, they had 15 layers of management.
27:28And they had this exercise, which then became really very
27:34strategic, where they took out 30 percent of management and
27:38seven or eight layers, because people were too far from the
27:42consumer and too far from, you know, the business.
27:44And they had built -- as all businesses do -- a bureaucracy.
27:48And so, I think we should look at this.?
27:52And I said, "Tell me a little bit more.?
27:55And she said, "Well, probably one out of three middle to
27:59senior managers are going to have to go.?
28:01And I said, "Look, we have all these initiatives, but we're
28:03really a people-based business.
28:05We're not capital-intensive.
28:07We're people-intensive.
28:08We have so many countries.
28:09The operating model is not mature enough yet, or matrixed
28:15enough for us to take out the people.
28:17I understand the concept, but I just don't -- I don't think
28:21I think it would take away -- I don't think we have the
28:24I don't think we can do that.?
28:27So Friday night he says to me, "If you think about this.
28:30This is what's going to happen, Andrea.
28:31So you're going to get fired if you don't turn this around.
28:34But then, because you've got, you know, the history and the
28:37track record, Hydrix is going to call you, and they're going
28:40to put you into another company, and then you're going to be
28:43the turn-around CEO who gets to look at everything fresh.
28:45You won't know any of the people.
28:47You won't have any, you know, allegiance to the strategies,
28:50and you're going to go in and be able to just cut, do, and
28:54change, because you'll be objective.
28:57So you have to make a choice.
28:59If you can't come in on Monday morning and reinvent yourself
29:03and pretend you just got hired here and you're going to look
29:06at everything, your team, your strategies, your
29:11organizational structure.
29:13And if you can't do the things that a turn-around person
29:18would do if they came in here Monday morning, I wouldn't put
29:24If you can, you will be far better than anybody else could,
29:27because you know where every rock is, you know every single
29:31thing about it, and you've got the latent goodwill and
29:35equity that you've built up.
29:36So you make the choice.?
29:38So that's what I did.
29:39I went home, and I thought about it, and I came in Monday
29:43We took out eight layers.
29:44We went forward and reshaped.
29:49I had a very hard look at some people who were terrific
29:54friends and got us from, you know, three billion to six
29:58billion, but weren't going to get us to eleven.
30:00And then, made all the hard calls, with the right values,
30:04and the rest has been the last few years.
30:07But, you know, I had to become a definer of my own second
30:13chapter and start it afresh.
30:15So it's been like a new job.
30:16>> Well, Thank you for your candor.
30:18With that, we'd love to open it up to the audience for
30:22And there are mics around the sides.
30:24>> Thanks for joining us, Andrea.
30:35I believe you developed a passion for playing the piano at a
30:40Could you talk a little bit about how that influenced you
30:43And also a little bit about how your passions and interests,
30:46that are outside of work, at this stage in your life?
30:49Andrea Jung: Well, I have very little time anymore to play,
30:54and I actually had a piano teacher a few years ago who
30:56dropped me, because he said to me, "You keep going on trips,
30:59and you keep canceling on me, so I'm not going to take you
31:02until you get a little bit of calmness in your life.?
31:05Interestingly -- and Mark can probably say the same thing.
31:08We used to have to -- we had not only a metronome on the
31:11piano, but also a timer.
31:13And this was our first example of discipline.
31:16When it was an hour, I mean, if it was like 50 minutes and
31:20we wanted to go play tennis, or -- there was no getting up.
31:23It was one hour of that discipline.
31:26And besides sort of passion for classical music, one of the
31:30first things that I recall in terms of self-discipline in my
31:34life was remembering that, you know what?
31:36It's 59 minutes, and it's not till it's sixty -- that you
31:40keep working at something.
31:41So you know, that is one of the things that I think that it'
31:45s given that's extraordinarily important to have an
31:49appreciation -- I was an English major, but just, for the
31:52arts -- you sit there in business and some people say to me,
31:56"You were an English major, and, you know, you're writing in
31:59shorthand e-mail at this point.
32:02That's the extent of your writing??
32:06And it's really not, because I think just the critical
32:10thinking and the ability to communicate and to have people
32:17understand where we're going and what the vision is.
32:21I think much of that I can kind of go back to my education
32:25It's had application.
32:32>> You mentioned how you're able to motivate and inspire
32:36You also mentioned how the lessons that you've learned from
32:40the other boards that you serve on.
32:41I'm wondering how you've been able to adjust your leadership
32:44style to motivate and inspire these more technology-based
32:49companies and these most bigger-than-life personalities,
32:54these male leaders at those companies.
32:55Andrea Jung: I think that, you know, the experiences that I'
33:03ve had at the company, as well as my own vantage point has
33:06been a different and interesting addition to the boards that
33:14The global experience, you know, our business in China for
33:17example, you know, where we have right, direct-touch
33:22consumer insights in understanding, in our case, of million
33:27one sellers who have millions of consumers in all the small
33:33One of the things, just so I'll use that example -- I spend
33:36a lot of time talking about that with Jeff Immelt or Steve,
33:39but we decided at Avon not to focus on the Eastern seaboard
33:45cities, the large cities.
33:46We decided to penetrate the small towns and villages and
33:50have a supply chain, an infrastructured strategy where the
33:54Because we knew that the government would like the fact that
33:58we were offering opportunities for people not to have to bus
34:01themselves to work into large cities, that we could create
34:05work for them right in the towns and villages where they
34:09And those insights and the behavior and the opportunity to
34:14understand the consumers and what they will do and what they
34:17will pay in those countries.
34:19Those are some of the insights I think I've been able to
34:22Very different personalities, so they make two very
34:25different men and two very different corporate cultures, and
34:28ours is completely different too.
34:30And it is interesting to weigh and balance that.
34:35So again, even though Avon is different from either of those
34:39two, those two couldn't be more different either, but both
34:42with enormous strengths.
34:43>> You spoke earlier about it being tough to get critical
34:54I was just curious about, over the years, ways you've
34:56figured out to solicit difficult feedback from your own
35:00staff on how you guys can improve?
35:05From a formal point of view, we do -- and I do -- a
35:13mandatory, "Anonymous 360" with all of my reports every
35:16I make them fill out a pretty tough thing about you know,
35:20their either toughest moment with me or where they really
35:22didn't think I lead well, what they would think I need to
35:25do, again, not attributed.
35:26And we have a discussion about that with all of them there
35:30and somebody from the outside who co-leads that every single
35:34And that's extremely helpful.
35:37I also encourage them, and I guess I've been in the role
35:41long enough, so there's amount of trust there.
35:44For them -- I'm a big believer in immediate feedback.
35:48You know, I fundamentally believe that if the first time
35:51you're hearing something negative about yourself is in your
35:54performance appraisal, then your boss is doing the wrong
35:57I mean, I'm a real believer -- right in that meeting -- if I
35:59think you didn't handle something well, I don't do it in
36:03front of everybody -- I don't believe that's the right thing
36:05to do, but I will call you in afterwards and just say, "
36:09In that meeting, this was handled like.
36:12I expected you to do X, Y, and Z.?
36:14And you won't anywhere near have to wait until a midyear or
36:19But they know that I do that, and I expect them to do the
36:24They know from this formal feedback what I think my
36:28derailers or the things that I tend to do wrong are, and I
36:31ask them to help me with that.
36:32So, if they notice it or they see it under stress coming out
36:36more that they'll just catch me on it.
36:38Just say, "By the way, today, you seem like you really are
36:42kind of doing X, Y, or Z.?
36:44It catches me on that, so it's helpful.
36:51Thank you for joining us.
36:53Andrea Jung: You're welcome.
36:54>> Out of curiosity, do you feel there still is a glass
36:56ceiling, and if so, what do you think the next generation of
36:59leaders can do to change that?
37:01Andrea Jung: It's a great question.
37:02You know, I think the numbers by themselves would say there'
37:06s still somewhat of a glass ceiling.
37:07I mean like 15 out of 500 I guess women in fortune five
37:12hundred would say there's room to go.
37:14But having said that, I am a real believer that the playing
37:20And what do I mean by that?
37:22When I go back even five years -- never mind when I became a
37:25CEO -- most women in, not the CEO job, but in the level
37:30underneath were in what I would call the "Staff jobs,"
37:34corporate communications, H R.
37:37They were not in the CFO roles or the leading operating unit
37:42If you look today, while the number may be small, the level
37:47below of women ready to take on the number one job or in the
37:50important C jobs -- the C suite jobs -- it's so dimensional
37:55that, I think, the next five years is going to be huge in
38:00terms of women in top leadership roles in business.
38:06So I think we are in very, very different moment.
38:10Also in parts of me, I mean you know, I keep saying there's
38:13these lists which I believe when the lists go away of top
38:17whatever, women will really have made it.
38:18But right now, while there are still lists -- you know, I'm
38:21hoping that I keep going down.
38:23What do I mean by that?
38:25I mean, my company is big, but there are people in much
38:28bigger jobs right now.
38:29In the fortune 50 companies.
38:31And so, women are not only breaking through, but they're
38:35breaking through with some pretty big roles, which I think,
38:40hopefully it's true in politics, as in business.
38:42So I think it's the jobs and the companies they're leading
38:45as well as the number of them who are ready to take on
38:48pretty large roles very, very different than even five years
38:51So I think the glass is very half full, more than half full
38:55So it's a different time.
38:58If women want it, I mean, I think it's there to be had.
39:08>> Hi. My question is, How do you stay innovative in the
39:11consumer product space over the last ten years?
39:13And especially kind of where the challenge is A in best
39:16practices and leading and guiding that innovation, and
39:18Andrea Jung: That's a great question, how do I stay
39:20innovative or how does one stay innovative.
39:22I mean, I think, you know, you guys are probably learning
39:25this more than anyone.
39:27That is, that innovation is so key.
39:30I think this is more important than ever.
39:33I think that the worst thing that can happen in this company
39:36is for people to cut back or de-spend.
39:38I mean if you kind of look at.
39:42I have studied that the actual market share gains and losses
39:50in normal or healthy economies -- it's pretty hard, when
39:55you're large to kind of get half a point of market share or
39:58It takes a long time.
39:59And so, in normal times it's hard.
40:01But, in the worst economies, they say that that's when
40:05disruptive shares gains or losses -- when industries go out
40:09-- and companies can go from bottom quartile to completely
40:11top, if they are on top of innovation.
40:14So really, I'm a huge believer this is actually a seminal
40:17moment for companies to invest.
40:19And I think it's a combination of things.
40:21One thing -- and I believe this is -- that there's a deal of
40:26instinct that's important in innovation.
40:30I think you can't always find it going back or in facts or
40:33I mean if you really -- you have to have some kind of art of
40:38it and the instinct of it, as well as the science and facts
40:41but, you know, the consumer herself or himself will tell you
40:45a good amount of the answer.
40:47I mean, you can be searching out there, but if you really
40:50listen and have the constant tentacles into -- I find some
40:57of the biggest answers in the customer complaint area.
40:59You go into your call center or your customer complaint area
41:03about your products and/or the services -- right in there,
41:06from what they don't like, is the answer to what you can do.
41:10So it is just like, go in there, sit there, and listen to
41:14I've done that for a couple hours every once in awhile, and
41:18you can get a tremendous amount there.
41:20There's great partners.
41:21I think innovation is -- it's got to be outside-in not just
41:28Lots of big companies -- P and G is a great example, who
41:31used to be more insular in terms of their innovation -- are
41:33doing partnering with universities, partnering with
41:37individuals, just trying to get more outside-in innovation.
41:40And so, for a company like ours where we maybe had our R and
41:44D did 85 percent of our innovation, I'm hoping it'll be 50
41:49percent in the next couple of years.
41:52Really trying to seek, because we have an entrepreneurship
41:56One of the things we did in this brand that we have called "
41:58Mark," which really was not named after Mark, but.
42:03Andrea Jung: Got a lot of brownie points at home, but the
42:07point of the brand was, you know, women making their own
42:11Andrea Jung: But one of the things that we did was open
42:18innovation from consumers.
42:19So if you -- we call it a participative brand.
42:24So if you are in Australia, and I mean, everybody -- there's
42:29so many people who have a great idea for a makeup product.
42:32And if you've got a great idea in Australia, you can send
42:37And it can be part of the brand.
42:39And so, and it can even, on the inside of our packaging on
42:42the carton it would say, "Suzy Smith, Australia.
42:45Avon Representative.?
42:46And so, what we're trying to do is have people virally, who
42:53have great ideas -- because we're an entrepreneur company --
42:57say, "You can give us a product and maybe if you keep
43:00selling enough of this, we can help seed-fund you to help
43:02start your own makeup business.
43:04And we've got some enormously interesting ideas right from
43:09our own consumer and/or our seller base.
43:14>> I'm a firm believer in a professional mom.
43:17I wonder if you could give us information on how you divide
43:21your time and make sure you get these disciplines across to
43:24your children and do the bang-up job at home as you do at
43:31Well, my answer for this -- which has evolved -- is the
43:36following: I don't know.
43:37I'm sure there are some people who can get it all done in
43:41I am not one of them.
43:42But, I really believe two things: One is, it's all about
43:50There are days that my children absolutely win and the
43:56There are also days where the company has to win and they
44:00And I think I've made the right choice with the right
44:05So the days Avon loses, I don't feel guilty if I'm not at a
44:10Years ago, I would not go to an Avon meeting, and I would
44:13feel guilty about it the whole time.
44:15I don't do that anymore.
44:16My probably best example is this time it was this -- couple
44:20of administrations ago, so it was George W Bush.
44:23And they were inviting eight CEOs to the White House.
44:26I'm the only woman invited on a specific topic.
44:29And it was also the first day that my daughter was going
44:33away to a camp that mothers were going to take their kids to
44:37And, you know, it was one of those things where it was like
44:42I mean, I really thought, "George W is never going to
44:45remember if I am at that luncheon.?
44:48Andrea Jung: But my daughter's going to remember one way or
44:54another, for probably the rest of her life.
44:57So I didn't go to the White House.
44:59I got a chance to go at another time.
45:02And, you know, that decision was an easy one.
45:06Have I missed a game? Yes.
45:08Have I missed the most important one? No.
45:11Have I missed a meeting at work? Yes.
45:13The most important one? No.
45:15So for me, it's just making a decision like that and living
45:21You know, I think you also have to have a sense of humor.
45:24I remember this was in the Jack Welsh succession moment, and
45:30we had a Saturday morning call.
45:33And we were all opining on who we felt Jack had a point of
45:38view should be in the succession for GE.
45:42And it was the day of my son's third birthday party and I
45:46was at a Jodi's gym, and -- don't ask why, but I could not
45:51figure out how to use the mute button on the cell phone, so.
45:54Andrea Jung: I was in an electrical closet taking this call.
45:58And so, there'd be like, "Okay.
45:59So Senator Nunn, what do you think??
46:01And he's opining, and the closet bursts open and my son's
46:05like, "It's the wrong Scooby Doo! It's the wrong brown.?
46:09Andrea Jung: And I am like this:
46:14[half-whispering] "I will buy you ten more presents --
46:19Andrea Jung: -- if you leave this electrical closet.?
46:21And of course he wouldn't.
46:23So, "It's the wrong one! Damon had the other one; you have
46:28the wrong one!" So, the whole GE board -- those who are
46:31still on the board are like, "Wrong color Scooby Doo,
46:34Andrea Jung: But you have to have a sense of humor about it.
46:38And it's real, and it's life.
46:45>> In addition to having a social mission, is there a core
46:48to the corporate mission?
46:49Avon's very involved in some philanthropic efforts.
46:53I was wondering if you could speak a little bit more about
46:56And also, as a public company, if you receive any resistance
46:59from some of the stakeholders that might be concerned that
47:01it's unrelated or detrimental to the bottom line?
47:05Andrea Jung: Well, let me just start by saying I read a lot
47:11of business books -- as I'm sure you have.
47:13I mean, so, I pretty much read them all, but one of my
47:16favorites is "Good To Great," by Jim Collins.
47:18And the last paragraph of Jim Collin's book has always
47:21If you go back and read it, it basically says that, "It is
47:25impossible to have a meaningful life without meaningful
47:29And that, in order to have meaningful work, it really is
47:33And that, if you can find work where it actually matters --
47:36not about shareholding -- but the work actually matters in
47:40life, you can then have a great life -- and I'm a huge
47:43personal believer in that.
47:44So we have a foundation.
47:46We've raised $725 million.
47:48So that's the largest kind of women's foundation, mostly
47:52towards women's health and "violence and oppression against
47:57And it's -- men and women alike in the company are equally
48:02passionate about the fact that, you know, we do "good" as
48:07And, it is really part of the corporate culture.
48:11It's not about check writing.
48:13I mean, our people participate.
48:15They walk; they are deeply, deeply involved in it.
48:22And I think it continues to make a difference.
48:25From a "public company" point of view, we do get at the
48:28shareholder meeting, you know, in the old adage that "No
48:32good deed goes unpunished", we do have some activists who
48:36come in -- not so much that it's, you know, it goes against
48:40public company profits, because, in fact, I can argue that
48:43it's helped the brand equity.
48:45And it has helped revenues and associations with company
48:49I think there's enough of companies like us that can prove
48:52that it is an enhancement to brand equity, but you know, we'
48:56ll have our share of activists who kind of want to pick on
48:59But in general I think there's a pretty direct correlation
49:02to -- when it's not just over here, when the work of a
49:05company -- whether it's sustainability you know, Wal-Mart --
49:10lots of companies have really proven that when you are doing
49:14the right thing for community, for society, it trumps and
49:21really adds to corporate revenues and profitability.
49:31So I'm a big believer in that.
49:33>> So you're in a 140 countries.
49:35So some democracies, some dictatorships.
49:36How do you see your company interacting with different forms
49:38of government, and what do you foresee you got to do in the
49:42United States as the government becomes more activist?
49:44Andrea Jung: Well, I think that, you know, certainly in the
49:49United States, but in general -- as we like to say in
49:52I mean, the regulators and the government is taking a larger
49:58They've moved in next door, and they're not moving out.
50:03And so, I think the role of government relations for a
50:07company, you know, we're not highly regulated, but even for
50:11us, the role of government relations in Washington
50:16contingent or your industry groups that are representing you
50:19are much more critically important.
50:22And I think it's important to have the opportunity to talk
50:28with some of the staff and make sure that, in Washington,
50:34that companies are being heard.
50:36I think, the first few months was so primarily focused on
50:40the financial sector, and then auto.
50:46That, really being able to hear the voice of consumer
50:49companies and other industry companies and understanding tax
50:53legislation implications -- health care implications -- is
50:58For consumer companies, I mean, the number one issue in my
51:01mind is unemployment and the stimulus money getting back
51:04into the economy to the create jobs.
51:05Because, in a consumption-based economy where unemployment
51:09is over ten percent, that is tough for a structural recovery
51:13of consumer spending.
51:14And so that I certainly think for developed markets remains
51:19But it's a new world order for companies with government
51:27quote "intervention and/or regulation" and having the
51:31ability to work with governments, partner, and be heard, is
51:36important -- much more so than it was when I took over ten
51:39This is a whole another ball game.
51:42But, you know, I think the vehicles, the forums, are
51:49So I'm encouraged on that front.
51:51There's a lot of time being spent now listening, which I
51:56>> Last question, all yours.
51:59>> So as business school students who are obviously pretty
52:02early still in our careers, and I was wondering if you could
52:04talk about kind of how you shape the trajectory of your
52:07career and what sort of criteria you use to base, and the
52:10initial steps and positions that you had when you were
52:18Andrea Jung: Well, one I've mentioned probably the most
52:20important inflection point for me to make a decision which
52:23was to "Really choose what you love" as opposed to what
52:28necessarily "you think you should be doing" and/or "tying it
52:32to income" and/or "title.?
52:36I think the other thing that I would say is, I had spent
52:41most of my early career in retail and then higher end
52:44retail, and, from a non-emotional point of view on the Avon
52:49front, but on sort of -- I really took, I think, a risk when
52:53I left high-end retail and went to Avon.
52:56You know, people were like, "Why are you doing that??
52:59I mean "Ding Dong, the Avon lady.
53:01I never even seen an Avon representative.
53:03That's a really dated brand.?
53:07And I felt that it would be a real change.
53:11I thought it was different, alternative distribution.
53:15I think distribution is key.
53:18A lot of people talk about branding, but I think, "he who
53:21wins the distribution game" -- look at Amazon -- that's all
53:24Just if you are in the consumer space -- he or she who can
53:27nail and reinvent the distribution game, will win.
53:31Branding is critical.
53:33That's the cost of entry now.
53:34Distribution is the final trump.
53:39But it was an alternative distribution channel and it was
53:42And I would say to you, you can take 2009, you can have an
53:46economic recovery projected in 2010 and 11.
53:49GDPs in the developing emerging world is where the growth is
53:54I mean, you can't run from the fact that, economically, it
53:58is global companies who truly have presence.
54:01And I know, whether it's programs here that involve, really
54:04just getting out there and understanding those economies.
54:07Being able to work in a company and work in those
54:10environments culturally, as well as understand the business
54:14The lion share of the growth.
54:17I mean, in our industry -- shave it -- 88 percent of the
54:22growth between 2008 and 2013 in the category is going to
54:27come from the developing and emerging markets in 2013.
54:30So going to be something like that in every place, and being
54:35able to operate there I think is important.
54:37But choosing a global company, one with an alternative
54:40distribution system, and one that really needed a turn
54:43around were a big bet.
54:46And that was important.
54:49The other thing in my career I would say I have always done
54:52is, Try to do something outside my job.
54:56In other words, example would be, I was in charge of
55:00domestic marketing, you know, for the domestic division.
55:04And they needed somebody to kind of take on globalization,
55:09which was very unpopular in our company at the time.
55:11It was sort of the "Not-Invented-Here Syndrome" was alive
55:15Everyone wanted to do their own marketing when I came to the
55:18The first day I came, we put on a table one fragrance.
55:23This country didn't like the color.
55:25This country didn't like the name.
55:26This country didn't like the smell.
55:27I mean, it was just as decentralized as it can be, and
55:31someone had to take on the ugly job, if you would, of really
55:34trying to centralize.
55:35And that was a really tough word.
55:38And so, I did it in addition to my day job.
55:41I took it on, and it was unpopular.
55:44But I got visibility obviously to the top, because they
55:49wanted to understand if we could go left or right on this.
55:52And that probably was pretty a big deal from a career point
55:57>> Thank you so much for coming.
56:01Andrea Jung: Thank you everybody.
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